Source · Select Committees · Science, Innovation and Technology Committee
Recommendation 3
3
Acknowledged
Paragraph: 44
The Government has chosen at this stage to support the development of both green and...
Conclusion
The Government has chosen at this stage to support the development of both green and blue hydrogen. We heard that the initial adoption of blue hydrogen will be cheaper than green hydrogen, and ready to use in certain niche industrial settings sooner. However, several analysts have argued that green hydrogen will become cheaper than blue hydrogen over time.
Government Response Summary
Government has been clear in the UK Hydrogen Strategy and subsequent publications that it considers support for multiple production routes the most appropriate approach while building the hydrogen economy.
Paragraph Reference:
44
Government Response
Acknowledged
HM Government
Acknowledged
Government has been clear in the UK Hydrogen Strategy and subsequent publications that it considers support for multiple production routes the most appropriate approach while building the hydrogen economy, including both water electrolysis (green hydrogen) and methane reformation with carbon capture, utilisation and storage (CCUS) (blue hydrogen). Electrolytic and CCUS-enabled production routes have different production characteristics, scale, cost profiles and wider system impacts suggesting both can have an important role. The Department for Business Energy and Industrial Strategy’s (BEIS) Hydrogen Production Cost report suggested in 2021, under central fuel price assumptions, that CCUS-enabled methane reformation is the lowest cost production route but that electrolytic hydrogen costs are expected to decrease considerably over time, with green hydrogen produced using curtailed electricity potentially becoming competitive with blue as early as 2025. As indicated in the UK Hydrogen Strategy Update to Market: July 2022, BEIS – and now the Department for Energy Security and Net Zero (DESNZ) - will continue to keep input cost under review when considering the role of various technologies in meeting government’s production ambitions.